Very interesting discussion. I personally believe that while all of those "can't go wrong" formulas are helpful, a lot of times they are the very reason that prevents people from investing in RE in the first place.
Personally, I look at Real Estate as BOX which produces certain amount of money per month (positive cashflow), i.e. If I put in $30,000 of my hard earned money into the property, what will that investment pay me per month? And of course you'll have to account for maintenance costs, etc. but in general "Cash on Cash return" is the most interesting number to me.
It wasn't that long ago when I was starting to invest and it was before I've discovered Bigger Pockets forum. While everyone should do their own research on ANY investment they are willing to make, the amount of formulas and rules is truly overwhelming and can cause an un-treatable case of Analysis Paralysis! To me, if my original $30k investment produces $500 per month I'm a happy camper.
Thoughts?
